Sirwin
Sirwin

tBTC, the Safe Way To Use Bitcoin in DeFi, Is Live on tbtc.network


 

Launched with unprecedented security measures in place and ready to be used at tbtc.network, tBTC is fully audited and open-source.

 

 

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tBTC is an ERC-20 token that’s trustlessly backed by and redeemable for Bitcoin (BTC). In other words, it’s a way for users to deposit their Bitcoin and mint Bitcoin tokens on Ethereum without a middleman or KYC.

tBTC is a Bitcoin sidechain on Ethereum, built to give Bitcoin the capabilities of Ethereum and bring additional collateral to DeFi. The asset (TBTC) is an ERC-20 pegged to Bitcoin, it can be minted or redeemed for BTC by anyone and without intermediaries. Instead of relying on a single custodian like wBTC or federation of custodians like Liquid, tBTC is supported by a decentralized bonded multi-federated peg model using ECDSA technology.

tBTC is built on the Keep Network 3, and as of launching this week already has 24.21M USD locked in the network (22.69M USD in KEEP, 1.39M USD in ETH and 0.26M USD in BTC). We’ve decided to launch slowly and safely with a 9 week graduated cap, currently the cap is at 100 BTC but will rise to 250 later this week. See the full schedule here 5. Future plans for tBTC include pointing at least 5% of the KEEP supply at various liquidity rewards.

How does tBTC work?

If you’re familiar with MakerDAO and how DAI is created, you might recognize some of the mechanics used to make tBTC possible. For example, tBTC relies on price feeds, bonds, and arbitrage opportunities to keep the system running honestly.

In a nutshell, users wishing to mint tBTC deposit Bitcoin into an address trustlessly created and controlled by a group of bonded signers. The bonds keep the system participants honest by incentivizing good behavior and punishing dishonesty. Currently, deposits are only possible in fixed-sized lots of 1 Bitcoin. And, all signer bonds are denominated in ETH.

Let’s dive into the spec provided on its website to see how exactly tBTC is minted.

Depositing Bitcoin to mint tBTC

1. The depositor puts down a bond and sends a deposit request transaction to the tBTC smart contract on Ethereum

Sending a deposit request transaction signals to the smart contract that you’d like to mint new tBTC by depositing Bitcoin. The depositor must put down a bond in the form of ETH to initiate this process. The bond serves as a form of anti-spam mechanism and is returned to the user when the deposit is completed.

2. A signing group is selected and the BTC wallet / deposit address they create is returned by the Ethereum contract

When creating the deposit address, the system randomly selects a group of signers which generate the Bitcoin wallet together. And so, this new Bitcoin wallet requires M of N signatures to generate valid Bitcoin transactions.

And in order to keep signers honest, those who wish to become a signer must put down a bond of ETH proportional to the risk they pose to the system. For example, if the BTC wallet requires 3 out of 5 signatures, the signers must each have a bond of ETH equal to 0.33 BTC.

3. The depositor sends the BTC to the deposit address and then sends a transaction with proof of the deposit to the tBTC smart contract.

The depositor takes the deposit BTC address returned by the smart contract and sends it 1 BTC. After the transaction is confirmed, the depositor submits a transaction including a proof which is verified on-chain by the signers with a simple payment verification (SPV) system.

4. The contract mints tBTC and a beneficiary token both of which are issued to the depositor

The signing group verifies the proof of deposit and issues the tBTC tokens to the depositor. The tBTC smart contract keeps 0.0005 TBTC of every deposit as a beneficiary bond. Additionally, the depositor receives an ERC-721 token which signifies the beneficiary or who receives this bond in the future.

Redeeming tBTC for Bitcoin

On the flip side, redeeming tBTC for Bitcoin is pretty straightforward. Simply, submit a redemption request transaction to the smart contract which includes your desired recipient Bitcoin address. During which you’ll repay the outstanding TBTC deposit amount, signer fees, and 0.0005 beneficiary bond.

The beneficiary receives their 0.0005 TBTC and little bit extra back.  And, the rest of the tokens are burned, including the ERC-721. Next, the signers wait for the transaction to be confirmed on the Ethereum blockchain. Finally, the signers produce a signature which can be submitted to the Bitcoin network to send your BTC to the address you specified.

What makes tBTC useful?

Ethereum’s known for being the leading programmable blockchain with a wildly active developer community. Effectively tokenizing BTC without a middleman opens up a world of possibilities for users and developers alike.

tBTC makes it possible for Bitcoin holders to tap into Ethereum’s growing list of decentralized finance (DeFi) DApps. For example, smart contract developers could integrate tBTC into their DApps as collateral. Thus, enabling Bitcoin holders to be able to borrow against their BTC. Or, even something as simple as Bitcoin can now be trustlessly listed on decentralized exchanges (DEXes).

Still have questions about tBTC? Come talk with us on Discord

tBTC is tested and audited

tBTC has been tested rigorously and has undergone an unprecedented three audits. tBTC concluded its first security audit, by ConsenSys, in March. In June, we concluded a second audit by Trail of Bits, and in August we completed a new Bitcoin audit.

The audits to date have included an aggressive focus on the Go clients in the network as well as the smart contracts in the system. The Trail of Bits audit also focused on expanding and automating more integration and system tests for tBTC, as well as adding fuzz and property testing to various components where appropriate.

We are also looking to the community to help identify and address issues. That’s why the maximum reward for the tBTC bug bounty program is now 1 million KEEP for responsibly disclosed severe vulnerabilities.

tBTC is backed by the community

Support for tBTC has grown to more than 50 partners over the last few months. Recently, the likes of Scalar Capital’s Linda Xie, Synthetix’s Kain Warwick, TokenSoft’s Mason Borda, and Aragon’s Luis Cuende have all said they plan to use tBTC as their BTC-ETH bridge, while the newest tBTC integrations include Matcha, UMA and FalconX. tBTC has also received $2 million from supporters including IOSG and Digital Strategies in Keep’s latest fundraising as a follow-on to an $8 million round earlier this year. This strong support indicates the demand for a safe, reliable BTC-ETH bridge and the community’s confidence in tBTC.

Keep stakedrop update

Keep’s stakedrop, which will let people stake ETH to earn KEEP, will soon be underway. Over the coming weeks there will be additional updates as the stakedrop timeline progresses. ETH holders will soon be able to earn KEEP by proving their ability to secure the Keep network. In addition to the stakedrop, there will be an upcoming opportunity to earn KEEP via liquidity mining. Users will be able provide liquidity for tBTC pools and earn yield, stay tuned for more details about tBTC liquidity rewards. tBTC, which lets people safely earn with their Bitcoin, is the first app built atop the Keep Network. Anyone can deposit their BTC to take full advantage of Ethereum, and anyone with the capital and know-how will be able to earn fees staking and supporting the bridge.

Website - https://tbtc.network/

Discord - https://discord.gg/pmcfeHE

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My Discord - Tarantino#0975

 

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STAF
STAF

Blockchain Enthusiast. Cryptocurrency . Bounty . Airdrop


Cryptocurrency . Bounty . Airdrop
Cryptocurrency . Bounty . Airdrop

Cryptocurrency . Bounty . Airdrop

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